The only successful applicant for the Black Industrialist Programme in Limpopo is taking the department of trade and industry to court because he didn’t receive his promised R14.2 million grant.
 
Murendi Properties was listed in the department’s annual incentive report up to March last year as the only beneficiary of the scheme in Limpopo.
 
Murendi’s project was an expansion of a building supply retail company and manufacturing plant for roof tiles, for which the Industrial Development Corporation (IDC) had also approved a R30 million loan.
 
IDC loans, together with grants from the department, have been the bedrock of the much-publicised Black Industrialist Programme.
 
The owner of Murendi, Mphendziseni Makhesha, said in an affidavit that the department’s behaviour, which he termed “dilatory” – meaning that it was an act intended to cause delay – had threatened the whole project and could result in 34 retrenchments out of total staff of 90.
 
He applied to the department for the grant in 2016 and it was initially approved in October 2017.
 
Makhesha claims that the department has stopped talking to the company altogether after initial hiccups with its BEE certificate, an issue Makhesha says was rectified.
 
According to his affidavit, he had procured certificates from two different unregistered verification agencies – effectively getting defrauded – before getting a certificate from a proper agency.
 
The court application is targeted at Trade and Industry Minister Rob Davies and the director-general of the department, Lionel October. The relief demanded is that the department be forced to pay the R14 million grant it had approved.
 
The IDC has already paid out “almost all the amounts it approved”, the state-owned funder told City Press.
 
“This is to enable the company to commission its new plant, albeit at a reduced scale in the absence of the department of trade and industry’s grant. This was done to enable the company to start servicing its obligations to the IDC once the repayment obligations kick in.”
 
Makhesha has also already put down R7 million of his own money to settle an earlier debt owed to the National Empowerment Fund.
 
The department’s deputy director-general: incentive development and administration, Malebo Mabitje-Thompson, told City Press the industrialist scheme worked better than most incentives the department had deployed.
 
Mabitje-Thompson, however, implied that there was something wrong with the Murendi grant and the department was opposing the case.
 
“As part of our commitment to zero tolerance to corruption, we will defend any action against the department in court where we believe that governance processes have been breached,” said Mabitje-Thompson.
 
The department has already filed notice that it would oppose the application, implying that it believed there was a breach of governance of some sort.
 
The department did not elaborate beyond generic terms.
 
“Once an application is approved and the investment is under way, inspectors are dispatched to verify the investment and performance information submitted for any claim. In the event that misleading information is submitted, the project is cancelled,” Mabitje-Thompson said by email.
 
There had been no suggestion that the department intended to cancel the project, said Makhesha. However, it did have Murendi investigated to establish the veracity of its BEE credentials.
 
The agency tasked with the investigation, the SA National Accreditation System, however, applied the newer codes of good practice for the construction industry.
 
Makhesha said that this was absurd because his company was not a construction company and, even if it was, the construction codes did not even exist when he applied for the funding.
 
“There can be absolutely no lawful basis on which the department can avoid its obligation to honour the grant,” said Makhesha.
 
Mabitje-Thompson said that the programme as a whole had shown a “remarkable conversion rate from investment decision to start of production”.
 
“To date, 130 projects have been approved; R1 billion has been disbursed.”
 
The IDC said that it had funded “close to 300 deals involving 291 black industrialists” since the programme was launched in 2014.
The Eastern Cape is anxious about possibly losing its R80 billion oil refinery project to Richards Bay in KwaZulu-Natal.
 
For more than a decade, the initiative, known as Project Mthombo, was planned for location at Port Elizabeth’s Coega special economic zone. But this, as well as a possible investment by Saudi Arabia in the project, could soon be lost because of the Durban/Gauteng oil pipeline that is already in existence.
 
Oscar Mabuyane, the Eastern Cape MEC for finance, economic development, environmental affairs and tourism, said there was uncertainty about the project because a decision had yet to be made.
 
“It is clear that there are two sites being explored: the Coega site that government has worked on for some time now, as well as the Richards Bay site, which has been added to the equation,” he said. “Our argument is that government has already incurred costs in developing the Coega site, so this could result in fruitless expenditure.”
 
Mabuyane believes that, more than an economic project, the initiative also carries political clout in that it will take bold political decision making to keep Project Mthombo in the Eastern Cape. And, he believes, doing so will also address a potential fuel security risk.
 
Project Mthombo was mooted by PetroSA as its answer to South Africa’s persistent fuel supply problems, given the refinery’s projected output of 300 000 barrels a day of crude oil. As things stand, South Africa’s fuel demands make the country vulnerable to imports, and it is hoped that this project goes some way towards mitigating that.
 
“People use the argument of Richards Bay’s connection to Durban and Johannesburg via an already existing Transnet pipe that pumps oil from that side,” said Mabuyane. “But from a security point of view, it is a risky situation. If something happens there, what then? How do you connect to Johannesburg? We have an opportunity as government to look at the situation broadly and open our minds.”
 
He said the private sector could easily fund a pipe connection between Port Elizabeth and Johannesburg.
 
Mabuyane said the project, as currently mooted, was solid and was the result of a 15-year investment by government.
 
“Project Mthombo is massive. It is unprecedented.
 
It is one project that connects about five regions in the province, including municipalities such as Sarah Baartman, Buffalo City, Amathole, Chris Hani and Nelson Mandela Bay.
 
“When you talk about the project you also talk of the biofuel project in Cradock, and the opportunity from that.
 
“We believe that it is a project that will be really catalytic, in the literal sense of the word. Driving it from here means that its impact and expansion – and how it connects with almost every participating region in the province – will be felt by many, and its potential of attracting more than 27 000 jobs cannot be ignored.”
 
Mabuyane expressed the view that government should work with the province and stop sending mixed signals about the project as it was “high time” that there was this kind of investment in the Eastern Cape.
 
Mabuyane said that, for too long, the province had been isolated, and government needed to change this.
 
“We believe that a lot needs to be done to lift our province to the level of other provinces, so that it can also participate in the country’s GDP.

In its investor presentation, TymeBank compares its fee structure to those of the established banks in the country, based on a medium-use banking profile of 17 transactions a month.

The fee comparison is based on Solidarity’s 2018 banking charges report.

It’s worth noting that in the comparison below, withdrawal transactions are split between POS withdrawals and own-ATM withdrawals.

According to TymeBank, even though it does not have its own ATMs, because of its partnership with Pick n Pay and Boxer stores, each till-point effectively becomes an access point to withdraw and deposit money.

Withdrawals at these till points is free. If withdrawals are made at other retailers, this fee is R2.00 – and if customers head to an ATM, a withdrawal carries a charge of R8.00 per R1,000.

Because the Solidarity report was published in September 2018, it does not include Bidvest Bank’s GROW account (which launched in November 2018), nor does it cover Capitec’s fee changes announced this month.

We have updated the information to include these changes, for the most recent like-for-like comparison. These are outlined below:

The 17 transaction profile includes POS withdrawals, limited ATM withdrawals, prepaid purchases, internet payments (EFTs) and debit orders.

TymeBank does not currently have prepaid airtime purchases available, but the bank did indicate that it is in the works, and that it won’t charge for these transactions.

Fee structures

A breakdown of the SA bank entry level account fee structures can be found below:


TymeBank Account2018 FeesR500 transaction in 20182019 FeesR500 transaction in 2019% Change from 2018 to 2019
Withdrawal (Native ATM) Free Free
Withdrawal (Other ATM) R8.00 / R1 000 R8.00
Withdrawal (POS) Free Free
Deposit (ATM) R4.00 R4.00
Monthly account fee (PAYT)   Free  

You can view the TymeBank Fees here.

Old Mutual Money Account2017/18 FeesR500 transaction in 2017/182018/19 FeesR500 transaction in 2018/19% Change from 2017/18 to 2018/19
Withdrawal (Native) R6.50 R6.50
Withdrawal (Other) R8.50 R8.50 R8.50 R8.50
Withdrawal (POS) R2.50 R2.50 R1.50 R1.50 -40.0%
Deposit (ATM) R7.00 R7.00 R7.50 R7.50 +7.1%
Monthly account fee (PAYT) R4.50   R4.50  

You can view the Old Mutual Money Account fee schedule for 2018/19 here.


Capitec Global One2018/19 FeesR500 transaction in 2018/192019/20 FeesR500 transaction in 2019/20% Change
Withdrawal (Native) R6.50 R6.50 R6.00 / R1 000 R6.00 -7.7%
Withdrawal (Other) R8.75 R8.75 R8.00 R8.00 -8.6%
Withdrawal (POS) R1.60 R1.60 R1.00 R1.00 -37.5%
Deposit (ATM) 95c / R100 R4.50 R1.00 / R100  R5.00 +11.1%
Monthly account fee (PAYT) R5.75   R5.00   -13.0%

You can review Capitec’s full 2019/20 pricing here.


Absa Transact Account2018 Fees
(15% VAT)
R500 transaction in 20182019 FeesR500 transaction in 2019% Change from 2018 to 2019
Withdrawal (Native) R6.05 R6.05 R6.50 R6.50 +7.4%
Withdrawal (Other) R12.11 R12.11 R10.50 + R1.50 / R100 R18.00 +48.6%
Withdrawal (POS) R1.31 R1.31 R1.60 R1.60 +22.1%
Deposit (ATM) R4.54 + R1.41 / R100 R11.59 R4.50 + R1.50 / R100  R12.00 +3.5%
Monthly account fee (PAYT) R4.99   R5.30   +6.2%

Absa’s full 2019 pricing can be found here.


Nedbank PAYU Account2018 Fees
(15% VAT)
R500 transaction in 20182019 FeesR500 transaction in 2019% Change from 2018 to 2019
Withdrawal (Native) R6.50 R6.50 R7.00 R7.00 +7.7%
Withdrawal (Other) R8.00 + R1.51 / R100 R15.55 R8.00 + R2.00 / R100 R18.00 +15.8%
Withdrawal (POS) R2.00 R2.00 R2.00 R2.00
Deposit (Intelligent depositor ATM) R1.00 / R100 R5.00 R1.00 / R100 R5.00
Monthly account fee (PAYT) R5.50   R5.50  

Nedbank’s PAYU 2019 pricing can be found here.


Standard Bank Access Account2018 Fees
(15% VAT)
R500 transaction in 20182019 FeesR500 transaction in 2019% Change from 2018 to 2019
Withdrawal (Native) R1.82 / R100 R9.10 R1.85 / R100 R9.25 +1.6%
Withdrawal (Other) R8.07 + R1.82 / R100  R17.80 R9.00 + R1.85 / R100 R18.25 +2.5%
Withdrawal (POS) R1.82 R1.82 R1.40 R1.40 -23.1%
Deposit (ATM) R1.61 / R100 R8.05 R1.65 / R100 R8.25 +2.5%
Monthly account fee (PAYT) R5.30   R5.60   +5.7%

Standard Bank’s full Access 2019 pricing can be found here.


FNB Easy Account2017/18 FeesR500 transaction in 2017/182018/19 FeesR500 transaction in 2018/19% Change from 2017/18 to 2018/19
Withdrawal (Native) R1.85 / R100 R9.25 R1.90 / R100 R9.50 +2.7%
Withdrawal (Other) R8.00 + R1.85 / R100 R17.25 R9.00 + R1.90 / R100 R18.50 +7.2%
Withdrawal (POS) R1.40 R1.40 R1.60 R1.60 +14.3%
Deposit (ATM) R0.90 / R100 R4.50 R0.95 / R100 R4.75 +5.6%
Monthly account fee (PAYT) R5.25   R5.75   +9.5%

You can find FNB’s Easy 2018/19 pricing guide here.


Bidvest Bank Grow Account (PAYT)2017/18 Fees
(Transact)
R500 transaction in 2017/182018/19 Fees
(Grow)
R500 transaction in 2018/19% Change from 2017/18 to 2018/19
Withdrawal (Native) R5.50 R5.50 R6.00 R6.00 +9.0%
Withdrawal (Other) R9.60 + R1.40/R100 R16.60 R6.00 + R1.40/R100 R13.00 -21.7%
Withdrawal (POS) R4.00 R4.00 R5.00 R5.00 +25.0%
Deposit (Branch) 0.80% of value R4.00 0.80% of value R4.00
Monthly account fee (PAYT) R22.00   R6.00   -72.7%

 

Credit: BusinessTechBusinessTech

Zimbabwean and South African officials will meet next week, as preparations for the visit by South Africa's President Cyril Ramaphosa to his northern neighbours gather momentum.

President Ramaphosa will visit Zimbabwe on March 12 for the Third session of the two countries' Bi-National Commission (BNC), and Zimbabwe's Ambassador to South Africa Mr David Hamadziripi said yesterday that preparations for the visit were underway in both Harare and Pretoria.

The two countries held their last BNC in October 2017 and the visit by President Ramaphosa will give a lift to the already existing strong bilateral relations.

"We are going to have meetings with relevant South African officials next week to prepare for the BNC," he said.

"It is important to note that the BNC, which last met in Pretoria in October 2017, will review co-operation across the board.

"We expect issues around trade and investment, energy, transport, health, security and defence among others to be the major talking points." 

He said one of the major issues expected to dominate the discussions was the establishment of a One Stop Border Post (OSBP) at Beitbridge. Under the concept travellers will be cleared once for passage into either country as opposed to the present situation where travellers have to queue twice at either side of the border to complete the same processes, which slows down the movement of cargo and human traffic.

Zimbabwe and South Africa enjoy cordial relations dating back to the days of their struggle for liberation. There is also likely to be a strong geopolitical flair as South Africa, the most influential neighbour and Africa's strongest economy, will likely throw weight behind Zimbabwe on the back of external pressures against the country, notably regarding illegal sanctions imposed on the country by the West.

Last week, the 28-member European Union bloc reviewed its restrictive measures on Zimbabwe, which was but a small token amid opposition to the embargo from progressive forces.

South Africa's Minister of International Relations and Cooperation Lindiwe Sisulu this week revealed that South Africa remained ready to help Zimbabwe, underscoring that the regional giant had a strong interest in having Zimbabwe as a peaceful and prosperous neighbour. She said of sanctions against Zimbabwe was central to this and that sanctions would feature in the discussions between Presidents Mnangagwa and Ramaphosa. President Ramaphosa has been a strident anti-Zimbabwe sanctions campaigner himself.

Last month, he took the campaign to the 49th edition of the World Economic Forum (WEF) in Davos, Switzerland, where he publicly called for the lifting of the embargo. Last year, he also called on the European Union (EU) to lift sanctions on Zimbabwe during the 7th South Africa-European Union Summit in Brussels, Belgium, where they discussed a number of issues around trade, climate change, women's rights among other global issues.

The EU and the United States of America maintain sanctions on Zimbabwe, with the EU having progressively loosened the measures. The US remains adamant, tying the punishment of Zimbabwe and Zanu-PF to give an advantage to the opposition MDC-Alliance.

 

- Bulawayo24

The South African government is forecast to be hit by a tax revenue shortfall of almost R43 billion for the tax year ending next month, Finance Minister Tito Mboweni indicated in his budget speech on Wednesday.
 
There were pronounced risks to the local economic outlook with the main risk of concern being power utility Eskom and its financial woes, the 2019 budget review report indicated.
 
The report indicated that government tax revenue for the 2019 fiscal year would come in at R43 billion under the target set at the 2018 budget speech.
 
“There are pronounced risks to the economic outlook. The main risk of concern is Eskom. Failure to fully implement the reconfiguration of Eskom could lead to a negative market reaction that would prompt capital outlflows, with greater pressure on the rand. It would also perpetuate weak investor confidence and reduce economic growth,” the report said.
 
In the worst case scenario, National Treasury is forecasting negative 1% growth this year while its best-case scenario is just over 2% growth.
 
Mboweni cut the National Treasury’s forecast for economic growth for this year from 1.7% to 1.5% due to “fragile recovery in employment and investment, and a less supportive global trade environment”.
 
By 2021, the National Treasury’s best-case scenario is growth of 3% and its worst-case scenario is 1%.
 
“The economic and revenue outlook has deteriorated since the October 2018 medium-term budgetary policy statement and funding pressures from state-owned companies have increased,” the medium-term budgetary policy statement said.
 
“Several other state-owned companies are also in financial distress and have requested government support. As a result, the contingency reserve has been revised up by R6 billion in 2019/20 and any funding provided will be offset by the sale of non-core assets. Additional reforms to strengthen the governance, finances and operations of state-owned companies will be announced in the months ahead,” the 2019 budget review report said.
 
State companies that are looking for bailouts include the South African Broadcasting Corporation (SABC) and Denel.
 
“Several state-owned companies face negative cash flows and are financing operations from debt, which has become increasingly difficult to raise. This moves them perilously close to default unless they receive some form of recapitalisation.”
 
In another worrying sign, debt owed to municipalities is increasing. At the end of March, debt owed to municipalities is forecast to climb to almost R159 billion from almost R99 billion at the end of March 2015.
 
Of debts owed by municipalities that are more than 90 days in arrears, Eskom is the major creditor – it is owed R12.8 billion – followed by water boards with R6.4 billion.
 
“From July 2018 to June 2019 municipal financial year, 113 municipal councils adopted unfunded budgets, up from 83 the prior year.”
 
The government is expecting to issue $2 billion (about R28 billion) in debt by the end of the 2019 fiscal year.
 
Over the next three years, the government will raise an additional $8 billion (about R114 billion) in global capital markets.
 
“This year’s budget underlines the National Treasury’s continued commitment to these requirements in a difficult environment in which economic growth remains weak, public debt and debt-service costs have accelerated and governance and operational concerns are manifest across the public sector,” the review report said.
 
“Weak economic performance and residual problems in tax administration have resulted in large revenue shortfalls,” the report said.
 
“The deteriorating financial position of state-owned companies has put additional pressure on the public finances,” the report added.
 
“The government’s efforts to reform state-owned companies and the launch of the infrastructure fund are expected to increase growth and investment in the year ahead,” the 2019 budget review report said.
 
For the 2020 fiscal year, consolidated government expenditure is forecast to R1.83 trillion.

The South African government is forecast to be hit by a tax revenue shortfall of almost R43 billion for the tax year ending next month, Finance Minister Tito Mboweni indicated in his budget speech on Wednesday.

There were pronounced risks to the local economic outlook with the main risk of concern being power utility Eskom and its financial woes, the 2019 budget review report indicated.

The report indicated that government tax revenue for the 2019 fiscal year would come in at R43 billion under the target set at the 2018 budget speech.

“There are pronounced risks to the economic outlook. The main risk of concern is Eskom. Failure to fully implement the reconfiguration of Eskom could lead to a negative market reaction that would prompt capital outlflows, with greater pressure on the rand. It would also perpetuate weak investor confidence and reduce economic growth,” the report said.

 
 

In the worst case scenario, National Treasury is forecasting negative 1% growth this year while its best-case scenario is just over 2% growth.

Mboweni cut the National Treasury’s forecast for economic growth for this year from 1.7% to 1.5% due to “fragile recovery in employment and investment, and a less supportive global trade environment”.

By 2021, the National Treasury’s best-case scenario is growth of 3% and its worst-case scenario is 1%.

“The economic and revenue outlook has deteriorated since the October 2018 medium-term budgetary policy statement and funding pressures from state-owned companies have increased,” the medium-term budgetary policy statement said.

“Several other state-owned companies are also in financial distress and have requested government support. As a result, the contingency reserve has been revised up by R6 billion in 2019/20 and any funding provided will be offset by the sale of non-core assets. Additional reforms to strengthen the governance, finances and operations of state-owned companies will be announced in the months ahead,” the 2019 budget review report said.

State companies that are looking for bailouts include the South African Broadcasting Corporation (SABC) and Denel.

“Several state-owned companies face negative cash flows and are financing operations from debt, which has become increasingly difficult to raise. This moves them perilously close to default unless they receive some form of recapitalisation.”

In another worrying sign, debt owed to municipalities is increasing. At the end of March, debt owed to municipalities is forecast to climb to almost R159 billion from almost R99 billion at the end of March 2015.

Of debts owed by municipalities that are more than 90 days in arrears, Eskom is the major creditor – it is owed R12.8 billion – followed by water boards with R6.4 billion.

“From July 2018 to June 2019 municipal financial year, 113 municipal councils adopted unfunded budgets, up from 83 the prior year.”

The government is expecting to issue $2 billion (about R28 billion) in debt by the end of the 2019 fiscal year.

Over the next three years, the government will raise an additional $8 billion (about R114 billion) in global capital markets.

“This year’s budget underlines the National Treasury’s continued commitment to these requirements in a difficult environment in which economic growth remains weak, public debt and debt-service costs have accelerated and governance and operational concerns are manifest across the public sector,” the review report said.

“Weak economic performance and residual problems in tax administration have resulted in large revenue shortfalls,” the report said.

“The deteriorating financial position of state-owned companies has put additional pressure on the public finances,” the report added.

“The government’s efforts to reform state-owned companies and the launch of the infrastructure fund are expected to increase growth and investment in the year ahead,” the 2019 budget review report said.

For the 2020 fiscal year, consolidated government expenditure is forecast to R1.83 trillion.

South Africa and Turkey have pledged to support Ghana’s Aviation sector to ensure it met world class standards.

They would offer technical advice, help train pilots, and share experiences among other things to deepen the ties between the countries.

This came to light when Madam Lulu Xingwana, South Africa’s High Commissioner to Ghana, and Dr Ozlem Ergun Ulueren, Turkey’s Ambassador, paid courtesy calls on Mr Joseph Kofi Adda, the Minister of Aviation, in Accra on Friday.

Dr Ulueren said Turkish Airlines, one of the biggest in the world, flew to 300 destinations and would support Ghana to strengthen her Aviation sector, especially as Turkey had opened the New Istanbul Airport.

She said Ghana had attached importance to improving the relationship between the two countries, thus, Turkey would not only provide capacity building for Ghanaian pilots but also train the Aviation staff to effectively deliver.

Dr Ulueren said Turkey had also invested 500 million dollars in areas including construction adding that Turkey and Ghana would build partnerships in tourism and agriculture, which would benefit both countries.

She welcomed public opinions to make the airline industry better whilst urging Ghanaians to take advantage of a promo introduced to explore Turkey.

Madam Lulu, on her part, said South Africa was involved in the development of the Kotoka International Airport Terminal 3 and would continue to offer advice, service and train young pilots to expand the Ghanaian Aviation sector.

She said South African Airlines (SAA) is working in collaboration with the African World Airlines (AWA), which flew to Lagos, Free Town, Liberia, Cote d’Ivoire among other areas to make it possible for Ghanaians in regions other than the Greater Accra to fly directly to those destinations.

She said SAA was adding another flight from Ghana to Washington and willing to share skills, expertise and assist in training air personnel to strengthen AWA and SAA’s relationship.

Mr Adda, who received the two visitors, appealed to them to support in the establishment of a pilot training academy and assist in getting back Ghana’s airline.

Turkey should also aid Ghana in constructing its regional airports as well as develop airport cities with standardized infrastructure, he said.

A Memoranda of Understanding was signed to formalise their relationship.

GNA

South Africa has provisionally withdrawn an arrest warrant for Ajay Gupta, a businessman and friend of former president Jacob Zuma, in a corruption case, police said.

The case against Gupta relates to allegations made by former deputy finance minister Mcebisi Jonas, who said that a member of the Gupta family offered him the job of finance minister and a large bribe if Jonas would help the Gupta family with its business ventures in South Africa.

The Guptas have denied any wrongdoing.

“The warrant for Ajay Gupta was provisionally withdrawn,” said Hangwani Mulaudzi, a spokesman for the Hawks police unit. “But it can be reinstated.”

 

- Reuters

South Africa, home to almost all of the world’s rhinoceroses, said the number of the animals killed by poachers plunged by 25 percent last year as it stepped up efforts to save the endangered species.

With 769 rhinos poached, it was the first year since 2012 that less than 1,000 of the animals were killed illegally, the Department of Environmental Affairs said in a statement. The animals are targeted for their horns, which are believed in Asia to help cure cancer and boost male virility. The horns are made of keratin, a hair-like substance. The number of rhino deaths peaked at 1,215 in 2014.

The fight against rhino poaching in South Africa has become emblematic of the global struggle against wildlife traffickers, with national awareness campaigns ranging from documentaries to the sale of plastic horns, which are attached to people’s cars.

The decline in rhino deaths is “a confirmation of the commitment and dedication of the men and women working at the coalface to save the species,” said Minister of Environmental Affairs Nomvula Mokonyane, who is also known as Mama Action.

More than half of the rhinos were killed in Kruger National Park, a reserve the size of Israel that lies on South Africa’s border with Mozambique. Poachers frequently cross the border and hunt the animals with automatic weapons and night sights before sawing off the horns.

During the year, 365 alleged poachers were arrested countrywide along with 36 horn traffickers, the department said.

 

- Bloomberg

Zimbabwe's government continues to explore avenues of attracting lines of credit from neighbouring South Africa after the continent's most prosperous nation rebuffed an earlier request by Harare for a R16 billion (US$1,129 billion) rescue facility, Finance minister Mthuli Ncube has revealed.

South Africa has emerged as the only hope for President Emmerson Mnangagwa's administration for a financial lifeline after several countries, including China, spurned its approaches, citing Harare's tendency to default on debt repayment.

Ncube confirmed in an interview this week that several meetings he held with his South African counterpart Tito Mboweni have so far failed to convince the regional economic giant to commit itself to rescuing Zimbabwe.

"There is no commitment, but we have ongoing discussions," Ncube said, adding government would welcome any form of financial assistance from south of the Limpopo.

"We are in constant talks with South Africa, they are our neighbour, biggest trading partner and we have a bi-national commission. So we have been interacting with them, to see whether they can be of help and support us whenever we need it," he said.

The Treasury boss said government remained hopeful in the face of shrinking sources of credit.

Although there remains a possibility of South Africa extending a US$7 million credit facility to clear part of Zimbabwe's World Bank arrears, the neighbouring country appears reluctant.

Mnangagwa told private media journalists a fortnight ago that: "We started engaging South Africa earlier this year when we had the cooking oil shortage. Then because of the nature of relations between us and South Africa, we said to South Africa can you give us lines of credit. So this is why discussions between the South African minister of finance, our own finance minister and the governor of Reserve Bank of Zimbabwe started."

"Talks are therefore underway for a line of credit from South Africa Botswana has also given us line of credit worth 70 million Pula. What it means is that Zimbabwean businesses can get goods from those two countries worth that amount. We are then given a grace period and then we could be able to repay the credit within an agreed period of time, say to or five years. It is different from a bailout package in that it does not come with certain conditions attached to it," he added.

While critics in South Africa say lending to Zimbabwe would be a waste of money, President Cyril Ramaphosa has over the past week said there is need to support Harare.
However, he has not qualified the kind of support he would prefer.

Zimbabwe is desperate for lines of credit which could go a long way in fixing a tattered economy, which is on the verge of total collapse. Foreign currency shortages continue to haunt industry while the cost of living has soared.

To worsen the situation, Harare's biggest Western cheerleader Britain pulled the plug on Mnangagwa's re-engagement drive when London dissociated itself from the regime last week following the killing of an estimated 17 people during the suppression of violent protests which rocked the country last month while 78 others were injured and more than 1 000 were arrested.

Britain, a key Mnangagwa ally after the toppling of former president Robert Mugabe in the November 2017 coup, had also emerged as the only Western power supporting Zimbabwe's re-engagement with IMF, World Bank and re-joining Commonwealth.

Although Mnangagwa has denied that the country is seeking a bailout package, former finance minister Patrick Chinamasa revealed on a trip to China last year that government was seeking a rescue package of US$2,5 billion to support the productive sectors which include tourism, mining and manufacturing.

Acting Chinese ambassador Zhao Baogang said that they will not give Zimbabwe a bailout package, focussing instead on sponsoring infrastructural development.

 

Source - The Independent

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